The home of America’s biggest university restricted shared housing for decades, but with a new state law in effect, dense inventory in College Station is poised to grow.
Texas A&M University has the biggest student body in the country, aside from universities with online schools, with over 70,000 students on campus each fall. Before this month, it was illegal for five or more unrelated people to share a home or apartment in most of College Station. Only certain neighborhoods were allowed exceptions to the “no more than four” rule, a rare restriction that became especially tight in a city of young, single tenants living away from their families.
“Only a handful of other cities in the state were using restrictive occupancy at a relationship level,” property manager and developer Jeffrey Leatherwood said.
Students, real estate agents and developers, including Leatherwood, helped convince the Texas legislature to pass Senate Bill 1567, which was fine-tuned for College Station. The law forbids college towns with populations of less than 250,000 from enforcing resident limits based on age, occupation, familial status or relationship status.
“The City of College Station was putting real estate people in a difficult situation, and SB 1567 made it a lot easier for us to conduct business,” Leatherwood said.
The bill took effect Sept. 1, and it’s not clear how long it will take the market to adjust. No permits for dense “Ag shack” developments have been approved in formerly restricted neighborhoods yet.
“What’s going to be interesting to see is when that six-bedroom plan gets submitted to the city, in an area where they had been traditionally pushing back on those plans, if that’s going to go through,” developer Scott Hancock said.
Meanwhile, recent student housing deals include a $30 million loan for Culver Investment Partners to acquire a condo property on Harvey Mitchell Parkway in a zone that did not have a shared housing exception, according to Traded.
The city is working to “clean up the books” and align with the law, said City Councilmember Bob Yancy, who criticized the law before it took effect.
Developers expect College Station to forestall dense development by other means, just as other Texas cities have attempted to hinder YIMBY legislation. For example, in response to another state law that allows residential development in commercial areas without rezoning, Arlington enacted requirements for parking space, balcony length and mandatory amenities, like swimming pools. Plano, Frisco and Irving have created similar requirements.
The city enforced the “no more than four” rule by citing homes with more than four cars parked out front. The city could try parking restrictions as a de facto cap on residents per unit, Hancock said.
The council will likely institute new parking rules, but they will aim to improve road safety rather than counter SB 1567, Yancy said.
“Our own housing policies were unnecessarily restrictive in housing starts,” Yancy said, referring to ordinances besides the “no more than four” rule.
The city has a shortage of about 4,900 units, he said.
“Approximately 10 years ago, the city began enforcing more stringent building regulations and fees, and they had a significant impact on our housing market and, I believe, exacerbated the occupancy problems that we have had throughout the city,” he said.
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